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GDP growth rate for '98-99 pegged at 5.8 pc

The advance estimates of the current fiscal year put the GDP growth at 5.8 per cent as against five per cent in the 1997-98, the inaugural year of the Ninth Plan.

Releasing the advance estimates prepared by the Central Statistical Organisation in New Delhi on Tuesday evening, minister for programme implementation Ram Naik said the high growth of 5.8 per cent for the current fiscal year is mainly due to higher agriculture growth, which is minus one per cent in 1997-98 and 5.3 per cent in 1998-99.

The quick estimates that put GDP at five per cent for 1997-98, is considering the fact that the first two years of the Ninth Plan have an average growth rate of 5.4 per cent of GDP. The task of averaging 6.5 per cent for the remaining year would involve exceptional effort.

According to the advance estimates, manufacturing registered a growth rate of 5.7 per cent as compared to 6.8 per cent in 1997-98.

Mining and quarrying registered a fall in growth rate from 2.7 per cent in 1997-98 to 0.1 per cent in 1998-99, one of the reasons being fall in production of coal.

Electricity and gas also registered a fall from 6.6 per cent in 1997-98 to 6.3 per cent in 1998-99. Community, social and personal services fell from 13.3 per cent to a low of 5.8 per cent, mainly because Pay Commission arrears were paid in that year.

Naik said there is qualitative improvement in statistics and idea of providing advance estimates is to capture the reality.

The advance estimates are based on anticipated level of agricultural and industrial production, analysis of Budget estimates of government expenditure and performance of key sectors like railways, transport other than railways, communication, banking and insurance available so far.

The advance estimates are based on constant prices having base year 1993-94 as against quick estimates, which are based on current prices.

GDP at factor cost in the year 1998-99 is likely to attain a level of Rs 1.1 trillion, as against quick estimates of GDP for the year 1997-98 of Rs 1.04 trillion.

According to the information furnished by the Department of Agriculture and Cooperation, the production of foodgrains during 1998-99 is likely to be 195.25 million tonnes as compared to 192.43 million tonnes during 1997-98, showing a growth rate of 1.5 per cent.

During 1997-98, foodgrains recorded a negative growth rate of 3.5 per cent. While production of wheat is expected to rise by 4.9 per cent, that of rice and coarse cereals is expected to decline by 0.1 per cent and 6.6 per cent, respectively during 1998-99.

Production of pulses is likely to show a growth rate of 13.1 per cent during 1998-99 and is placed at 14.78 million tonnes, as compared to the previous year's production of 13.07 million tonnes.

In the case of commercial crops, production of oilseeds, sugarcane and cotton are expected to register growth rates of ten per cent, 4.9 per cent and 25.8 per cent respectively, during 1998-99, as compared to the previous year's respective growth rates of -9.7 per cent, -0.5 per cent and -21.7 per cent.

According to the latest estimates available on the Index of Industrial Production, the index of mining, manufacturing and electricity, registered growth rates of -1.2 per cent, 3.7 per cent and 6.2 per cent, respectively during April-November 1998, as compared to the growth rates of 5.2 per cent, 6.9 per cent and 6.4 per cent in these sectors during the corresponding period of last year.

Based on the past trends, the GDP for mining, manufacturing and electricity during 1998-99 is expected to show growth rates of 0.1 per cent, 5.7 per cent and 6.3 per cent, respectively.

The construction sector is, however, expected to show a decline in growth rate at 2.3 per cent, during 1998-99, as compared to the previous year's growth rate of 4.1 per cent, mainly on account of less growth in production of cement and steel, in 1998-99.

The estimated growth in GDP for the trade, transport and communication sectors during 1998-99 is placed at 6.8 per cent, as compared to the previous year's growth rate of 5.7 per cent.

The rise in the growth rate is mainly on account of increase in the GDP of trade sector, which is estimated on the basis of volume of goods transacted.

The sector, financing insurance, real estate and business services, are expected to show a marginal decline in growth rate to 7.7 per cent during 1998-99, as compared to the previous year's growth rate of 8.4 per cent.

This is mainly due to higher inflation rates in terms of wholesale price index in 1998-99 as compared to that in 1997-98, which is used for deflating the aggregate deposits and bank credits to arrive at real prices.

The net national product at factor cost, also known as national income, at 1993-94 prices is likely to be Rs 9.79 trillion, during 1998-99, as against the previous year's quick estimate of Rs 9.26 trillion. In terms of growth rates, the national income is expected to rise by 5.7 per cent during 1998-99 in comparison to the growth rate of 4.8 per cent in 1997-98.

The per capita income in real terms (at 1993-94 prices) during 1998-99 is likely to attain a level of Rs 10,047 as compared to the quick estimates for the year 1997-98 of Rs 9,660. The growth rate in per capita income is estimated at four per cent during 1998-99, as against the previous year's estimate of three per cent.

UNI

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